With 747 attendees, Label Summit Latin America in Medellin, Colombia, hosted more people than any Label Summit run anywhere in the world. James Quirk and Danielle Jerschefske report

Label Summit Latin America 2014 showed the growing strength of South America’s Andean region as 747 people attended the conference and table-top exhibition held for the first time in Medellin, Colombia.

Previously alternating between Mexico and Brazil, the event’s move to Colombia was vindicated by a turn-out higher than in any Label Summit run by the Labelexpo Global Series anywhere in the world.

The Summit drew an impressive geographical spread of visitors, with attendees coming from across the Andean region – Colombia, Peru, Ecuador, Venezuela and Bolivia – as well as Mexico, Brazil, Argentina, Chile, Uruguay, Paraguay, Guatemala, Costa Rica and Panama. The Caribbean islands of Barbados and Trinidad & Tobago were also represented.

Indeed, the heavy weighting of visitors from Latin America’s smaller markets, at earlier stages of development than the likes of Mexico, Brazil, Argentina and Chile, was not merely a coincidence of geography. As evidenced by the packed conference room at the end of the second day, here was an audience as attentive and thirsty for knowledge as any hosted by a Label Summit in this region.

And while delegates responded with enthusiasm to the conference program, exhibitors were delighted by their numbers, with the visitor turn-out far higher than reasonably could have been anticipated at a launch event in a local market much smaller than Mexico or Brazil. The exhibition area – which spilled into corridors and even the conference room itself, such was the keenness of industry suppliers to be present – was awash with optimism.

Also of note was the quantity of converters who had only recently entered the self-adhesive label market, most often from a background in sheet-fed offset labels, package printing or wider-format converting. Your correspondents spoke with nearly a dozen such companies, from at least four different countries; further evidence, as previously covered on these pages, of new players entering and finding opportunities in the region’s smaller label markets, such as Bolivia and Peru.

Day one

‘I know you make the world’s best coffee, but I don’t think it can explain all the energy surging through this nation right now.’ With his opening words, keynote speaker Don Nolan, president of the Materials Group at Avery Dennison, the gold sponsor of the event, astutely noted the mood of optimism within Colombia. The country has seen strong economic development – foreign direct investment rose almost tenfold from 2003-2011, while GDP growth has been dour to six percent for each of the last four years – while in the label sector, Colombia and neighboring Peru have been Latin America’s fastest-growing markets in recent years.

Nolan, who was keen to emphasize Avery Dennison’s commitment to the Andean region (see boxout), identified three ‘mega-trends’ currently affecting the global label industry while neatly explaining how each was being handled in Latin America and where further opportunities for the region’s converters lie.

The first, he said, was the unprecedented numbers of people joining the middle-class in developing nations around the world: ‘It has been called the biggest growth opportunity in the history of capitalism’. McKinsey, a consultant, estimated that in 2010, two billion new middle-class consumers located across a dozen developing nations spent nearly seven trillion USD. By 2020, it forecasts a further one billion people entering the middle classes, increasing annual spending power to more than 20 trillion USD.

‘This trend is driving huge increases in global consumption,’ said Nolan, ‘and moving the center of gravity for global growth into the developing nations. It is drawing multinationals from around the world to emerging markets, breeding local giants, and raising the competitive stakes for everyone. Last year, global demand for label materials grew by six percent, and 80 percent of that growth came from emerging markets. Yet per capita consumption of label materials in emerging markets is still in single digits – leaving tremendous room for growth.’

The second trend is the ‘retail revolution’, continued Nolan. ‘Technology is shrinking the world and globalizing consumer experience. Global brands and major retailers are creating richer, deeper and more immersive brand stories. They are delivering them across multiple channels: in stores, online, and – increasingly – on mobile devices. It’s a revolution with huge implications for our industry: labels and packaging have become a critical part of brand strategy. And we are being asked to play a bigger, more creative role in the development and execution of that strategy.’

The third trend identified by Nolan was sustainability. Though historically of greater importance in the US and Europe compared to Latin America, Nolan said the trend was gathering momentum in the region and cited a number of local brands for whom sustainability has become a central part of their product offering.

Nolan concluded his presentation by outlining some of the growth opportunities in the region. ‘Here in Latin America, we see big opportunity in premium wine, spirits and bottled waters,’ said Nolan. ‘There is surprisingly little penetration by pressure-sensitive to date. We need to change that.’

Maria Gruesso, executive president of Colombian association Andigraf, analyzed the country’s graphic arts market. She noted that adhesive paper imports had risen by 84 percent from 2011-2012, and a further 35 percent from 2012-2013. The strength of local label converting was further demonstrated by statistics that showed a 44 percent rise in the tonnage of labels being exported from Colombia from January 2013 to February 2014. Ecuador, Venezuela, Panama and Cuba take 58 percent of exported labels.

Gruesso emphasized that Colombia benefits from numerous free trade deals, and as such local converters can look to the US, Canada, Europe and the whole of Latin America as potential markets for exported labels. She highlighted anti-counterfeiting, track-and-trace and augmented reality as particular areas of opportunity within the Colombian label market.

Aldo Gonzalez, CEO of Acrus-CCL, gave delegates the benefits of his extensive experience in mergers and acquisitions. Founder of Chilean wine and spirit label printer Cameo Marinetti, a joint venture with US converting group York Label, Gonzalez has been in charge of steering at least half a dozen M&A processes with international companies, and specializes in these kinds of transitions. Acrus-CCL, based in Santiago, is a joint venture between CCL and a Chilean investment holding company.

Gonzalez detailed the different steps of the buying or selling process and how to correctly value a company. He highlighted the factors that can make or break an acquisition, and emphasized that local knowledge should never be underestimated.

After giving his presentation, Gonzalez reported strong interest in the topic from the audience. ‘I was surprised at the immense interest in M&A,’ he said. ‘More than seven managers and directors asked me for private meetings to cover some topics in more detail. As usual, the specialized networking that happens at a Label Summit is unique.’

Fabian Silva, who now heads national sales for Baumgarten Mexico, created recently following Brazilian converter Baumgarten’s acquisition of Etiquetas Rodak, gave a presentation on the parent company’s far-reaching and award-winning sustainability program, ‘Viva’, which is due to be rolled out both in Mexico and at Autopack in Argentina, also recently acquired by Baumgarten.

Technology sessions featured presentations from Martin Fraire of Leftech, the Latin America distributor for Japanese company Toyobo’s Cosmolight waterwash flexo plate system, alongside Hernan Saldarriaga, production director at Colombian converter Etipress, a user of the Cosmolight system. Hector Buenavista of Daetwyler advised delegates on how to select the right doctor blades to optimize the printing process. Francisco Soto of Rotoflex discussed trends in finishing technology, while John Vigna of Mark Andy explained how conventional printing can provide an alternative to digital for short runs.

A digital panel session brought together Alexander Mercon of HP Indigo, Lucas Calvo of Xeikon and Oscar Granados of EFI Jetrion, while a further highlight of day one was a panel discussion between label converters from across the Andean region. Fredy Gallon of Servibarras (Colombia), Jaime Yoshiyama of Kuresa (Peru), Kevin Blanco of Etiflexo (Venezuela), Francisco Arias of Sismode (Ecuador) and Juan Carlos Zamorano of Flexo Print (Bolivia) touched upon a wide range of issues, of which you can read more in the next issue of L&L.

Day two

The conference’s second day began with a focus on brand development and product design. Tony Estrada of Constantia Spear looked at pressure-sensitive label growth and trends in the beverage industry, noting that while in North America pressure-sensitive labeling takes a 35 percent share of the beer label market, in South and Central America that figure is only two percent. Estrada outlined some of the exciting innovations currently impacting the label industry, such as personalization, augmented reality, thermocratic inks and special-effect varnishes. And he previewed some which are on the horizon: optical effects, printed electronics, labels with embedded NFC capability, and edible inks – about which the food industry is particularly excited.

Powerful Yogurt’s Sarah Goldthwait discussed how the brand decided to target the untapped male market with a product redesign geared to appealing to health-conscious men. Forty-seven percent of men in the US do household shopping, yet yoghurt brands have traditionally pitched themselves to the female consumer. Goldthwait took the audience through every step of the rebranding process, and showed how the company was able to successfully open a new market thanks to its new packaging and design.

Hernan Braberman of Tridimage identified six trends in packaging design: ‘Wellness design’ promotes a feeling of environment and community; ‘Bio design’ emphasizes the green credentials of a product; ‘App design’ recognizes that packaging is the window to the brand, and promotes consumer interaction through smart phones; ‘Anti digital’ describes the trend towards emphasizing a homemade, authentic product; ‘Deco design’ places an ornamental value on labels and packaging; ‘Fun design’ uses humor as a tool to sell a product.

Dr Henry Castillo from NeuroMind delved into the application of ‘neuromarketing’ on the design of labels and packaging. Castillo demonstrated the power of design on consumer decisions, how effective product design can influence perception of quality and how neuroscience can be the key to entering the mind of the consumer.

Andreu Gombau of UPM Raflatac focused on trends and innovations in beverage and spirit labeling, outlining the opportunities available to help label converters shift from wet-glue to pressure-sensitive labeling. Uli Jorgens of Karlville talked about mid-web lamination for short-run flexible packaging and pouches. Sun Chemical’s Alfonso Paredes gave an overview of brand protection with a comprehensive examination of security inks and coatings and instant verification and authentication technologies using mobile technology.

The conference ended with a series of 10-minute presentations on new technology from various suppliers: Carlos Pescott of GEW, John Thome of BST Pro Mark, Guillermo Gonzalez of Klockner Pentaplast, Carlos Clement of Gerlab Chemical Services, Nick Vindel of JM Heaford and Luca Tubbini of X-Rite all took part.

Label Summit Latin America returns to Mexico in 2015, being held on April 21-22 at the World Trade Center in Mexico City.

Exhibitors see Andean region potential

Over 50 industry suppliers exhibited at the Summit, including Arclad, Avery Dennison, EFI, Flint Group, Gallus, HP Indigo, Mark Andy, MPS, Nilpeter, Omet, Prati, RotoMetrics, Sun Chemical, UPM Raflatac and Xeikon. Go to labelsummit.com/colombia for a complete list. Most had strong praise for the event’s

relocation to Medellin, Colombia. John Vigna of Mark Andy said: ‘The first instalment of Label Summit Latin America in Colombia proved that level of interest and growth within the Andean region is definitely something the industry should take seriously. We were extremely delighted and impressed by the converter turnout.’

Jesper Jorgensen of Nilpeter agreed: ‘Placing the event at the heart of the Andean region was right on target. This year, surprisingly, many label and packaging printers, all keen to establish new relations, attended for the first time. No doubt, the geographical location played an important part in this.’

Sun Chemical’s Alfonso Paredes stated: ‘The experience of the first Label Summit in Colombia was a complete success. The printers responded to the conference and the table-top exhibition with high interest and with a lot of questions. The quality of the participants was extremely high and I enjoyed discussing several technical aspects of the label industry in Colombia. For Sun Chemical Corporation and our new Sun Chemical Colombia company, it was a real pleasure to be part of the Label Summit.’

Martin Fraire of Leftech said: ‘Our tabletop stand, showing our waterwash flexo plate system, was always busy and many converters did not even know about this cleaner, faster and better technology for processing plates. The printer panel session, where three of the five speakers are actually users of our technology, provided nice support and convinced many people that this is the right way to process plates in a more environmentally friendly way and also much faster than with the solvent-based alternatives. We had so many good responses and projects to do in the short term that we are already short of equipment in Colombia to follow up with all the interested converters.’

About Andean Region

Don Nolan, president of the Materials Group at Avery Dennison, the gold sponsor of the Summit, emphasized during a meeting with L&L the optimism with which the company views the Latin American market as a whole, and the Andean region in particular. He also highlighted that, thanks to recent infrastructure investment in South America, Avery Dennison is able to roll out new products around the world at the same time.

With distribution centers in Lima and Medellin covering the Peruvian and Colombian markets, and manufacturing centers in Brazil and Argentina forming part of the company’s global production footprint, the company ‘can bring materials and innovations from anywhere’, said Nolan. ‘Service is the key: thanks to our global infrastructure, innovations can be rolled out globally.’

This has become particularly important in Latin America, added Ronaldo Mello, vice president and general manager, Materials Group, South America, because the region’s converters ‘are quick adopters of new products and often more willing to take risks’. He cited the example of Global MDO, Avery Dennison’s prime film range for for semi-conformable containers, which was made available in Latin America at the same time as elsewhere in the world, and which proved particularly popular among the region’s converters.

Nolan said that in the last 18 months he had spoken at Labelexpo conferences ‘on every continent’, with the event in Colombia having ‘the most attentive audience’. Colombia and Peru are the two fastest growing markets in Latin America for Avery Dennison. ‘We feel extremely optimistic about those markets and about the region as a whole; it’s a region of opportunity.’

This feature is published in Labels & Labeling issue 3, 2014

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